Just Dial's cash pile is as much as its market cap, says report

Shares of Just Dial jumped as much as 10% at the open after brokerage Kotak Institutional Equities reiterated its 'Buy' rating and set a target price of ₹1,175, citing early signs of a business turnaround under the company's new management team.

The analysts believe Just Dial is entering a phase where growth could accelerate after a weak FY26, driven by a renewed focus on expanding its paying customer base, launching new products and increasing penetration among business-to-business (B2B) merchants.

Management aims to boost the number of paid subscribers. While Just Dial has a massive base of around 56 million listings, only about 0.6 million are currently monetised, highlighting a significant opportunity to improve conversions and revenue generation.

Kotak identified three major growth levers. These include scaling up paid advertising campaigns, introducing new products and onboarding more B2B merchants. The brokerage noted that B2B merchants currently account for only 10% of the overall merchant base, leaving substantial room for expansion in the segment.

The brokerage expects these initiatives to help revive collection growth and push it back towards double-digit levels. Collections growth remained subdued in FY26, rising only 1.6% year-on-year, but showed signs of improvement in the first quarter of FY27, growing 14% year-on-year.

Kotak also highlighted Just Dial's strong balance sheet as a key investment attraction. The company is estimated to be holding around ₹6,000 crore in cash and investments, a figure broadly equivalent to its current market capitalisation.

However, the brokerage cautioned that a decision on how to use this cash pile may take longer to materialise. Investors have been closely tracking whether the company could deploy the cash for growth initiatives or consider returning a portion of it to shareholders.

Despite the uncertainty around capital allocation, Kotak maintained that Just Dial remains a compelling value pick. The brokerage said any indication from the board regarding a cash return strategy, including potential shareholder payouts, could act as an additional trigger for the stock.

The upbeat commentary helped fuel buying interest in the counter, with investors betting that improving collections growth and stronger monetisation could drive a re-rating of the internet search and local commerce platform.

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